Our goal is to understand how embryonic pluripotent cells differentiate into specific cell types of the immune system and to identify developmental defects leading to leukemia and lymphoma formation. Our approach is to analyze transcriptional control mechanisms for developmentally regulated beta cell-specific gene and isolated a novel Ets factor, NERF, with three alternative splice forms form human spleen and fetal liver. NERF is closely related to ELF-1, and Ets factor linked to T cell-specific gene expression; however, our preliminary results indicate that ELF-1 is a major Beta cell nuclear factor which interacts with the activates regulatory elements in Beta cell-specific genes. NERF and ELF-1 are highly expressed in early stages of Beta cell development and bind with similar affinity to Ets sites in several Beta cell-specific genes the highest affinity is for the Beta cell tyrosine kinase genes, lyn & blk. We propose to investigate the role and mechanism of action of NERF and ELF-1 in regulating Beta cell-specific genes using the blk gene as one apparent target gene. Our aim is to evaluate the role of NERF in Beta cell development and analyze structure/function relationships of NERF and ELF-1 to understand mechanisms responsible for functional differences between these two factors. Thus, the specific aims are to: Specific AIM number 1. Determine the role of NERF and ELF-1 in the regulation of Beta cell specific blk gene expression. Specific Aim number 2. Determine the role of protein-protein interactions and phosphorylation in the function of ELF-1 or NERF. Specific Aim number 3. Determine the effect of targeted disruption of the NERF gene on Beta cell development and blk gene expression. Due to the importance of the Ets family in regulation of various tissue- and differentiation-specific genes, in general, and hematopoiesis, in particular, NERF and ELF-1 are expected to play a central role in Beta cell development. Elucidation of the function NERF and ELF-1 in regulating Beta cell development will provide exciting opportunities to test the hypothesis that altered functions of these Ets factor result in leukemia.